Smart Cannabis Businesses are Staking a Claim to Their Intellectual Property

by Wendel, Rosen, Black & Dean LLP
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Pot leaves trademark image

Image is a derivative of “Trippy Multi Pot Leaves” by Weedpad.com/Weedpad_Papers

Yes, cannabis is still listed as a Schedule 1 Controlled Substance; and yes, the United States Patent and Trademark Office (USPTO) will not register trademarks for cannabis strains. But there are still a number of creative ways that cannabis businesses can stake a claim to trademarks; trademarks that the owners anticipate they will be able to expand to their cannabis products when, eventually, the USPTO lifts its embargo.

Federal Trademarks for Cannabis Collateral Products and Services

The USPTO has issued numerous trademarks for cannabis collateral products like rolling papers, grinders and vaporizers (The Original Amsterdam, Halcyon Haze); as well as cannabis themed clothing (Ganja Guy, Marijuana Monkey). The USPTO has also issued trademarks for cannabis related services, such as cannabis directories (Mellow Pages, Fortune420); advocacy groups (Legalize Consciousness, Women Grow Cultivating Cannabis Entrepreneurs) and cannabis medical advice (Perfect Marijuana and Seed to Patient).

These cannabis businesses are establishing a beachhead; branding their identity now to provide them with a substantial head start when they apply to register these trademarks for their actual cannabis products after the USPTO eventually allows such registrations.

State Trademarks for Actual Cannabis Products

Some of the states that have legalized cannabis are granting state trademarks to actual cannabis products as well as collateral goods and services. These trademarks provide trademark protection within the state, and a state trademark holder should have a substantial advantage to expand its trademark footprint nationally when the USPTO begins accepting such registrations. The California Secretary of State’s Office, which is responsible for state trademarks, is accepting applications for  trademark registration for cannabis products, although it will not confirm whether it will be granting those registrations. Given the size of the California market, cannabis businesses should submit their trademark applications yesterday.

Common Law Trademarks for Actual Cannabis Products

Cannabis businesses can also aggressively brand their cannabis products, relying on common law trademark rights. While the common law does not allow for infringement damages, it does provide trademark holders the right to enjoin an infringing use. Again, the use of fanciful names and aggressive brand protection should give a cannabis business priority in regard to its first-use-in-commerce date when the USPTO finally begins registering cannabis trademarks.

Using Cannabis Branding/Trademarks as a Shield

While the USPTO will not issue trademarks to cannabis products, cannabis businesses faced with trademark infringement actions can assert the usual trademark defenses, such as fair use, lack of likelihood of confusion, etc. Our firm represented a local cannabis dispensary that was sued by a non-cannabis business for trademark infringement. In that case, the plaintiff argued that since our client could not register its mark our client was effectively defenseless and had to cease all use of the disputed mark. The federal judge disagreed, allowing our client to assert the usual trademark infringement defenses.*

What Are You Waiting For?

With California’s recent legalization of recreational cannabis, existing cannabis businesses are looking to expand and new players are getting into the business. Despite the USPTO’s prohibition, savvy cannabis businesses are establishing their intellectual property rights today.

*Every case is different. Prior results do not guarantee a similar outcome.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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